Electricity Generation
The electric generation industry is segmented along fuel types that are used to generate electricity. The largest segment is coal-fired electricity, which accounts for about 50% of the market. This is followed by nuclear (19.3%), gas fired (18.6%), hydroelectric (6.4%), oil fired (3.0%), and other (2.8%) which accounts for all renewable types other than hydroelectric. Solar is the most environmentally neutral of all available options.

Electricity prices vary by region, but the 2007 national average was roughly 11¢/kWh. Electricity prices have been rising by roughly 5% annually during the past decade, with steeper hikes occurring more recently. The causes of these rate hikes include:

Deregulation:
there are, in fact, many costs in the electricity generation and transmission process that consumers have been protected from by rate caps put in place during industry deregulation. All of these protective caps will have expired by 2011, you can look forward to corresponding rate hikes as these hidden costs are passed on to you in your utility bill.

The Cost of Fuel for Conventional Electricity Generation:
Coal, oil and natural gas are all at record highs.

Coal:
The price of coal is up 140% since January of 2007 as demand continues to increase. It is estimated that there is 1 X 1015 kilos of coal in our planet, or enough to continue supplying demand for roughly 90 years at expected rates of increase. Coal is transported using gasoline, another reason for the price increase, as gas is at an all time, inflation-adjusted high. China fires up roughly one new coal-fire plant per week and became a net importer of coal for the first time in 2007.

Oil:
The price of oil has risen 693% since January of 1998. Despite ever increasing demand, peak oil production occurred back in May 2005! Despite record breaking corporate profits and record high oil prices, Exxon-Mobile production sank a full percent during 2007. According to OPEC there is roughly 80 years of oil at current increasing rates of demand.

Natural Gas:
The price of natural gas has risen by 30% during the first quarter of 2008 and by roughly 400% since 1998.

Increasing Electricity Demand:
The U.S. Department of Energy predicts a 40% increase in electricity demand by 2030, driving need for more production capacity and transmission capability.

Infrastructure Investment Costs:
Utilities are estimated to invest $31.5 billion in transmission infrastructure improvements over the next three years, up 60% from the previous three year period. Another compelling reason why solar is the answer to the impending energy crisis, is that it is a distributed power source, where generation is located at the point of use.

Environmental Compliance Costs:
Conventional energy sources pollute our air and water, and while regulation of energy generation byproducts has begun to become stricter, most agree that we have only begun to see the beginning of green house gas restriction. The current expectation is that utility companies will spend over $50 billion between now and 2025 in attempts to curb their green house gas emissions. Don.t forget, all of these costs will be passed onto you in your utility bill.

Transportation:
President Bush said .we want our city people driving not on gasoline, but on electricity. And the short-term goal, is to have vehicles that are capable of driving the first 40 miles on electricity.. This is fabulous (and given oil prices and reserves, inevitable), and we at Solairo would love to see this happen (given that added electricity production comes from renewable sources), but please keep in mind the affect of transferring large portions of the energy demand of the transportation industry onto the electricity generation industry: rate hikes.